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Obama warning of 'hard choices' Obama unveils his $3.6tn budget
(20 minutes later)
President Barack Obama has warned that there are "tough choices" about spending to come, as he prepares to unveil his first budget to Congress. President Barack Obama has unveiled a $3.6tn (£2.5tn) budget for 2010, aiming to pull the US out of financial crisis.
In a press conference, he promised to roll back tax cuts for the very wealthy and businesses that move jobs overseas. He has predicted the budget deficit for the current year will be $1.75tn, which is 12.3% of annual output and the biggest since World War II.
Planned spending includes $634bn to pay for healthcare reform and an extra $250bn to be set aside, in case it is needed to bail out US banks.
These announcements are an overview. There will be more details in April.
The president promised to roll back tax cuts for the very wealthy and businesses that move jobs overseas.
He added that instead, he would bring in tax cuts that would benefit 95% of hard-working families.He added that instead, he would bring in tax cuts that would benefit 95% of hard-working families.
The president said he would reduce the huge budget deficit by eliminating waste and inefficiency in government. He said he would reduce the huge budget deficit by eliminating waste and inefficiency in government.
"There are some hard choices that lie ahead," he said, adding that there were areas where the government would like to spend money in normal economic times, but would be unable to at the moment."There are some hard choices that lie ahead," he said, adding that there were areas where the government would like to spend money in normal economic times, but would be unable to at the moment.
"Each and every one of us has to compromise on certain things we care about, but which we simply cannot afford right now," he said."Each and every one of us has to compromise on certain things we care about, but which we simply cannot afford right now," he said.
He predicted that some of his decisions would be unpopular with special interest lobbying groups in Washington.He predicted that some of his decisions would be unpopular with special interest lobbying groups in Washington.
Healthcare subsidiesHealthcare subsidies
He also promised that the budget would be an honest accounting of the country's economic situation and "includes the full cost of fighting in Iraq and Afghanistan". He also promised that his budgets would be an honest accounting of the country's economic situation and include "the full cost of fighting in Iraq and Afghanistan".
The budget is expected to project a 2009 deficit of $1.75tn, up from $455bn a year earlier, according to local media. He projected spending of $200bn to fight those two wars over the next 18 months.
This would amount to 12.3% of GDP, the highest percentage since World War II. The president said he would introduce a scheme to give a subsidy to recently-unemployed people to help them maintain their healthcare funding.
The president said that one of the plans in the budget would be a scheme to give a subsidy to recently-unemployed people to help them maintain their healthcare funding. Providing easier access to healthcare was one of his key election promises.
Providing easier access to healthcare was one of his key election promises and more detail is expected in the budget speech. He has also promised to cut back on waste in government.
There will be much interest in how the president plans to control the budget deficit, despite the huge spending on financial stimulus packages.
"We're going to go through our books page by page, line by line to eliminate waste and inefficiency," he said."We're going to go through our books page by page, line by line to eliminate waste and inefficiency," he said.
"This is a process that will take time, but in the last 30 days alone, we have already identified $2tn in deficit reductions that will help us cut our deficit in half by the end of my first term.""This is a process that will take time, but in the last 30 days alone, we have already identified $2tn in deficit reductions that will help us cut our deficit in half by the end of my first term."
Thursday's announcements will give an overview of the budget and there will be more details in April.